New Delhi: India’s real Gross Domestic Product (GDP) is estimated to grow by 7.4 per cent in FY 2025–26, according to the First Advance Estimates of National Income released on Wednesday by the National Statistics Office (NSO) under the Ministry of Statistics and Programme Implementation (MoSPI). This compares with a growth rate of 6.5% recorded in FY 2024–25.
At constant (2011–12) prices, real GDP is estimated at ₹201.90 lakh crore in FY 2025–26, up from the provisional estimate of ₹187.97 lakh crore in the previous financial year. Nominal GDP, measured at current prices, is projected to increase by 8.0 per cent to ₹357.14 lakh crore, compared with ₹330.68 lakh crore in FY 2024–25.
Gross Value Added (GVA) at basic prices is estimated to grow by 7.3% in real terms during FY 2025–26. Real GVA is projected at ₹184.50 lakh crore, against ₹171.87 lakh crore in FY 2024–25, while nominal GVA is estimated at ₹323.48 lakh crore, reflecting a growth of 7.7 per cent.
Annual GDP and GVA Estimates along with Y-o-Y Growth Rates at Constant Prices
According to the NSO, growth in FY 2025–26 is primarily driven by the services sector, which has recorded higher estimated expansion compared to the primary and secondary sectors. Within the tertiary sector, Financial, Real Estate and Professional Services, along with Public Administration, Defence and Other Services, are estimated to grow by 9.9 per cent in real terms. The Trade, Hotels, Transport, Communication and Services related to Broadcasting segment is projected to expand by 7.5 per cent.
In the secondary sector, Manufacturing and Construction are together estimated to grow by 7.0 per cent at constant prices. The primary sector has shown comparatively moderate growth, with Agriculture and Allied Activities estimated to expand by 3.1 per cent, while Electricity, Gas, Water Supply and Other Utility Services are projected to grow by 2.1 per cent.
On the expenditure side, Private Final Consumption Expenditure (PFCE), a key indicator of household demand, is estimated to grow by 7.0 per cent in real terms during FY 2025–26. Gross Fixed Capital Formation (GFCF), which reflects investment activity, is projected to increase by 7.8 per cent, compared to 7.1 per cent in FY 2024–25.
Sectoral Composition and Growth Rates of Annual GVA in FY 2025-26
The NSO stated that the First Advance Estimates are indicator-based and compiled using the benchmark-indicator method, wherein estimates for FY 2024–25 are extrapolated using sector-specific indicators reflecting current-year performance. These indicators include data from the Index of Industrial Production, quarterly financial results of listed companies for Q1 and Q2 of FY 2025–26, estimates of major agricultural crops and livestock products, output of core industries such as coal, crude oil, natural gas, cement and steel, transport indicators from railways, civil aviation and ports, sales of commercial vehicles, bank deposits and credit, insurance premiums, GST data available up to November 2025, and accounts of the Centre and states.
Tax estimates used in GDP compilation include both GST and non-GST revenues. Budget Estimates for FY 2025–26, along with information from the Controller General of Accounts and the Comptroller and Auditor General, have been used for estimating taxes on products at current prices, while volume extrapolation has been applied for constant-price estimates. Subsidy estimates incorporate data on major subsidies such as food, urea, petroleum and nutrient-based subsidies, using available Centre and state expenditure information.
The NSO noted that discrepancies between GDP estimates derived from the production and expenditure approaches arise due to the use of different data sources and deflators for sectoral and expenditure components.
MoSPI also informed that the ministry is in the process of revising the base year of National Accounts from 2011–12 to 2022–23. As a result, the advance and quarterly estimates will undergo revisions due to methodological changes, the incorporation of updated data sources and revised annual benchmarks. The Second Advance Estimates of GDP for FY 2025–26, along with revised estimates for the past three financial years and quarterly GDP figures based on the new base year, are scheduled to be released on February 27, 2026.
– global bihari bureau
